HP Pushes Cloud Printing, Eyes Service Dollars

PALO ALTO, Calif. ( TheStreet) -- HP ( HPQ) is tapping the cloud to boost its Managed Print Service (MPS) capabilities, according to the one of the tech giant's top printing executives.

" Cloud's taking printing into a whole new strategic realm," explained Bruce Dahlgren, senior vice president of managed enterprise solutions at HP's Printing and Personal Systems Group, told TheStreet. "There's no better company on the planet to do this than HP."
HP says that cloud technology is revolutionizing printing.

Dahlgren explained that HP has an extensive enterprise customer base, as well as a strong printing legacy and extensive networking capabilities. The tech giant, he said, already has 3100 MPS customers, which include heavy-hitters such as Disney ( DIS), Merck ( MRK), General Mills ( GIS), 3M ( MMM) and eight of the top 10 banks.

Managed Print Services are specialized services that aim to improve customers' printing, copying and scanning. This could involve, for example, remotely monitoring and managing customers' multifunction printers, or standardizing devices to boost efficiency.

Dahlgren used the example of HP's ePrint service as evidence of cloud technology's MPS impact.

Launched last year, ePrint lets mobile workers print documents from mobile devices such as smartphones, tablets and laptops. "We were able to use the cloud to do this," explained Dahlgren, adding that HP worked with partners such as FedEx ( FDX) Office and Hilton Hotels to set up secure print locations for mobile workers around the world. "Whether you are in New York or whether you are in San Francisco, you can print," he said.

The executive explained that, similar to a GPS, the ePrint application tells customers which print locations are in their vicinity. When the user has picked a location and hit "print" on their smartphone, the print job goes into the secure HP private cloud, where it is held, and an access code is sent back to the customer's smartphone. The user then enters this onto the printing device, at say, a Fedex Office, to access the print job via the cloud.

"On every form of these devices, there is some form of authentication," said Dahlgren. "It's secure."

The executive told TheStreet that the ePrint application, which is available to all HP's MPS customers, has been downloaded more than a million times since its debut in April 2011.

HP uses three remote management centers dotted around the world to manage its MPS cloud. "What we do with these centers, is, on a real time basis, we go into enterprises, where we have managed print service contracts, and we can manage those devices remotely," said Dahlgren. "I could tell you 'this printer, based on usage, will be out of paper tomorrow' - I had better put paper in it tonight."

Speaking during the company's recent first-quarter conference call, HP CEO Meg Whitman cited cloud, along with security and information management, as key priorities.

The tech bellwether, which is slowly emerging from a turbulent period in its history, wants to boost its presence in high-margin areas such as software and services to combat ongoing hardware weakness, most notably in PC sales.

Dahlgren, for example, sees MPS as an opportunity for HP to sell data analytics software from its $10.3 billion Autonomy acquisition, as well as storage to manage the corporate data explosion.

HP's printing business, however, has been under pressure from falling revenue. Last month, the no. 1 PC maker announced plans to merge its Imaging and Printing Group (IPG) and Personal Systems Group (PSG) into a Printing and Personal Systems Group in an attempt to cut costs and boost its go-to-market strategy.

IPG revenue dipped 7% year over year to $6.3 billion during the company's recent fiscal first quarter results, while PSG sales tumbled 15% to $8.9 billion. HP's services revenue, in contrast, crept up 1% year over year to $8.6 billion.

Dahlgren, who spoke to TheStreet prior to the merger, said that the total addressable market for MPS is around $19 billion, a relatively small part of the $120 billion-plus print and imaging market. "This thing is evolving, and it's a new business," he said, adding that efforts such as mobile printing and large-volume enterprise production printing will help grow MPS.

The executive also pointed to enhancements in HP's Smart Decision Suite technology for managing print devices. "Over the last three and a half years, we have built some of the industry's best network, and soon, cloud-based, tools, to monitor those devices remotely," he said. "Some of the tools are already on the cloud, so we're evolving those things as we move along. But realistically, we will have probably all cloud-based within the next 12, 18, months."

HP shares dipped 13 cents, or 0.56%, to $23.14 on Thursday.

-- Written by James Rogers in New York.

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